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Leases

3 Months Ended

Mar. 31, 2021

Note 9 — Leases

As of March 31, 2021, we had operating right-of-use (“ROU”) assets of $111.9 million and operating lease liabilities of $117.1 million. We maintain operating leases on land and buildings for our operating centers, branch facilities and ATM locations. Most leases include one or more options to renew, with renewal terms extending up to 23 years. The exercise of renewal options is based on the sole judgment of Management and what they consider to be reasonably certain given the environment today. Factors in determining whether an option is reasonably certain of exercise include, but are not limited to, the value of leasehold improvements, the value of renewal rate compared to market rates, and the presence of factors that would cause a significant economic penalty to us if the option is not exercised. Leases with an initial term of 12 months or less are not recorded on the balance sheet and instead are recognized in lease expense on a straight-line basis over the lease term.

The Company also holds a small number of finance leases assumed in connection to the CSFL merger. These leases are all real estate leases. Terms and conditions are similar to those real estate operating leases described above. Lease classifications from the acquired institutions were retained.


	Three Months Ended
(Dollars in thousands)	March 31,
	2021		2020
Lease Cost Components:
Amortization of ROU assets - finance leases	$	117	$	—
Interest on lease liabilities - finance leases		15		—
Operating lease cost (cost resulting from lease payments)		4,343		2,258
Short-term lease cost		135		98
Variable lease cost (cost excluded from lease payments)		648		166
Total lease cost	$	5,258	$	2,522
Supplemental Cash Flow and Other Information Related to Leases:
Finance lease - operating cash flows	$	15	$	—
Finance lease - financing cash flows		106		—
Operating lease - operating cash flows (fixed payments)		4,140		1,672
Operating lease - operating cash flows (net change asset/liability)		(3,220)		268
New ROU assets - operating leases		1,298		458
New ROU assets - finance leases		—		—
Weighted - average remaining lease term (years) - finance leases		7.16		—
Weighted - average remaining lease term (years) - operating leases		11.30		13.92
Weighted - average discount rate - finance leases		1.7%		—
Weighted - average discount rate - operating leases		3.3%		3.9%

Operating lease payments due:
2021 (excluding the three months ended March 31, 2021)	$	15,931
2022		14,438
2023		13,705
2024		12,120
2025		10,703
Thereafter		76,428
Total undiscounted cash flows		143,325
Discount on cash flows		(26,258)
Total operating lease liabilities	$	117,067

As of March 31, 2021, we determined that the number and dollar amount of our equipment leases was immaterial. As of March 31, 2021, we have an additional operating lease that has not yet commenced of $3.5 million. This operating lease will commence in June 2021 with a lease term of 10 years.